A Follow-up to our predictions in: Technical UPDATE - One More "umph" then "AAAAAHHHHHHHH"!!!..... October 21, 2015
Market action on Thursday lifted in to the High Probability Target Zone published in TRIGGER$ on October 1st.
"Current market form suggests a consolidation, with another lift up needed to complete before the next significant drop occurs (continuation of the dramatic fall off that can be seen). This could see the red channels above re-tested...... bringing the market back over 2050" -- TRIGGER$, Oct 1st, 2015
Chart 2 shows us what occurred. The market lifted as anticipated, moving through HPTZ's (1)(2)(3)(4), retesting the significant red channel.
If you have been following any of our recent posts, we have been looking for 2055 and the target at HPTZ(4) specifically now for a number of weeks.
From here I am seeing two technical possibilities, both extreme moves to consider.
I have previously discussed a potential down that could be similar to the fall off we saw at the end of August. Chart 3 shows this with the orange boxes.
Another possibility is an extreme lift, similar to what we can see coming from the last bottom, or start of the C wave. Blue boxes show this potential. The green channel that can be seen to have held the most recent action is technically a continuation pattern that says we could see a move out of the channel similar to the move in to the channel.
The Blue boxes represent this move, and if it occurs we could see the market back to previous high levels (2140.00)
All indications at this point say there will be a continuation of the lift. However this can change quickly and we will need to watch the significant technicals to see which ones break and which ones hold.
A lift up through the next red channel resistance would be a good indication of more lift potential. Note however that there are several significant technicals above the market still and any of these could stop a lift short. For example, the next heavy green trend line that can be seen is the top resistance of the previous pattern the market was in before the drop in August. If the market reaches this, we would expect a reaction, even if it is just a consolidation. Reversal would be watched for.
IF the market stops soon and starts to fall off, a break through the bottom of the green channel that has just been lifted out of would be a good indication that more down is likely, with a possibility to see a drop off to around 1780.
Either way, the market is poised for a significant move, up or down. Don't guess. Wait for the technical triggers and follow along with what the market actually does.
Andrew J.D. Long, MFTA